It's here! The stuck-up and save sale is on this week at Lens, till you're pantry with deals by the dozen, including savings on your favorite food club items and more. Shop our weekly at online at lensgrowshery.com to see all the incredibly low prices. Lens, where delicious, begins. They say seeing is believing, but with Papa Murphy's pan pizza, it's all about the tasting. You couldn't imagine such a thick, crispy crust could be so light and airy until you take a big bite out of it.
You won't believe the buttery deliciousness until you experience the...yourself. And when you get to the last bite, you'll think, hmmm, I want another slice. So for a limited time, take and bake any two topping pan pizza for just $11.99 from PapaMurphy's.com. Previously on The Dropout, tragedy struck Theranos when scientists and Gibbons committed suicide. I see Holmes and Theranos that whole situation is being the reason he killed himself.
And despite this in extensive warnings from the inside, Elizabeth managed to pull off her blockbuster deal with Walgreens. Do you rip call if it said they were able to conduct all of those tests, those 250 tests with a finger stick of blood? Yes. And how many tests were there actually? I don't believe there was any. And Walgreens had no idea about this? Again, the deception was incredible.
People inside Theranos described a highly dysfunctional environment, with technology that they said simply didn't work. But the company was about to make the move from stealth mode to the main stage. And Elizabeth was ready for the spotlight. For ABC Radio and Nightline, this is The Dropout. Episode 3. A star is born. All right, guys, let's do this. Camera's ready. Here we go. Lock it up, please. Here we are at the ground floor of something that is revolutionary. And we're part of it here.
You're listening to the voice of Errol Morris, director of the Finn Blue Line and the Fog of War, which earned him an Oscar in 2004. The kind of advertising I like doing is you're creating a campaign or an idea of a brand where there's nothing that has existed before. About a decade after dropping out of Stanford, Elizabeth worked with the Academy Award-winning filmmaker on a series of promotional videos for Theranos. In one, you see a series of patients set against a stark white background.
Are you one of these people that love blood tests? No, I have a very bad relationship with Needle. As soon as I sit, I start to hyperventilate. There's an era of excitement. Well, I was wondering if you would take a blood test for us, which is one drop of blood. One drop? Bring it on. That's it. How are you feeling? It's all good. Elizabeth's serious face later fills the screen. Big eyes, black turtleneck, blonde hair pulled back.
People don't even know that they have a basic human right to be able to get access to information about themselves and their own bodies. In behind-the-scenes footage, Elizabeth stands on set, surrounded by cameras and equipment. Both she and Arrell sound genuinely giddy to be working together. I'm a fan. Well, likewise. Likewise. We did it. Thank you very much. But it wasn't just Arrell Morris, who was a fan of Elizabeth and her grand vision.
In 2014, her company was valued at nearly $10 billion, making her, at least on paper, the world's youngest female self-made billionaire, worth a staggering $4.5 billion according to Forbes. She had about 700 employees and Theronos wellness centers were now inside Walgreens. According to Elizabeth, they would eventually be in stores across the country. Elizabeth started showing up everywhere. She is the youngest self-made female billionaire on the Forbes 400 list.
At the glamour women of the year awards. I am so incredibly humbled and so honored to be with this incredible group of women. Introduced by none other than Jared Leto. Ladies and gentlemen, please welcome the only person I know who makes me feel like a lazy bastard. Elizabeth Holmes. At Forbes 30, under 30. First, it's such a special thing for me to be here, especially with this group of people. And thank you. On CNN. No one has ever seen a Sierra the first one.
Wow. I'm going to be at this morning. Let me ask a little bit about you. Do you own a TV? No. Why not? I work all the time. I'm basically in the office from the time I wake up and then working until I go to sleep every day. She even appeared on stage with Bill Clinton. You found this company 12 years ago, right? Tell them how old you were. That was 19. So don't worry about the future. We're in good hands. Elizabeth was on the cover of Fortune, Inc. Bloomberg Business Week in Forbes.
She was named one of times 100 most influential people, wired called her work Mind Blowing. There was even a glossy fashion spread in the New York Times style magazine. These big splashy profiles were kind of big wet kisses. It's Recoats Kara Swisher. And she was just very interesting. And especially given how much money had been invested, given who was doing the investing, given her board, given her whole style and look. I mean, it just played into a lot of things that magazines like.
She remembers when Elizabeth approached her at an event. She's like, oh, you should have me on stage at one of your events. And I'm like, I don't know anything about health care. So no. But I really remember thinking at the time, I wondered if it works. It sounds I had some blood issues and I thought, wow, that sounds great. I didn't have any expertise to tell it. So she asked you to cover her. Yeah, I like you need more women on stage. And I was like, I know, but not you.
At a Forbes conference, speakers were blown away by Elizabeth's massive entourage. It was unlike anything they'd ever seen before. Elizabeth Holmes was on before me. And I left my person in the green room. That's health care venture capitalist Anne Lamont. She's one of the most successful women in the field and has been named many times to the mightest list. That's the list of the top deal makers in technology.
And I could not get into the green room because she was there and she had two bodyguards outside the green room, two inside the green room. And I had to wait an hour to get to leave because she had my purse in this room. And I was like, who the hell is this woman? And back at Stanford, the legend of the university's now famous dropout, Elizabeth Holmes, was spreading. Professor Phyllis Gardner remembers that time well.
So I heard she was traveling with four bodyguards, carrying guns, packing heat, and traveled in a private jet. And she bragged about the bulletproof glass in her building. And I thought there was a lot of self-grantiosity involved. I mean, the whole Steve Jobs look. She loved being called the youngest woman entrepreneur, female entrepreneur, and being beautiful in the role. What was the conversation like here on Stanford's campus? I think the students were very enamored of the story.
I think particularly the women students love seeing a woman entrepreneur succeed. I mean, I understood that. I wanted to see a woman entrepreneur succeed. A visit by then Vice President Joe Biden to Theranos added to that sense of momentum. A much-hyped Silicon Valley startup had a special visitor today. We mentioned earlier in this news that. With cameras rolling, Elizabeth, in her signature black turtleneck, escorted the Vice President on a tour through a big warehouse.
There was a press conference where, sitting in front of what looks like some machinery, Elizabeth shared her mission on the main stage. Being able to make a dramatic reduction in cost, we can begin to make health information more accessible at the time it matters most. Biden called it a laboratory of the future. The way lab tests have been done have been extremely expensive. They've been inconvenient to literally get to get them done.
And instead of his tour, you can see what innovation is all about just walking through this facility. There was maybe just one problem. It's completely fake. Former Theranos Chief Design Architect Anna Ariola says, according to friends who worked there at the time. But the Vice President saw that day was completely rigged for his visit. Like they asked all the clinicians that were not full time to leave, don't show up for work that day.
A former employee in friend of Anna's who is there remembers the room, filled with what was supposed to be Theranos' breakthrough Edison devices, and tells us it was actually just a microbiology office days before, filled with old desks and computers. But she says they kicked out the microbiology team, gave the room a fresh coat of paint, and stocked it with every Edison they could get their hands on.
This employee sent us a photo she took the morning of Biden's visit showing all the Edison stacked row after row with fans seen in the foreground. She emailed, quote, the fans in the doorway are because they had been trying to dissipate the new paint smell. On top of that is Anna points out. Apparently it was video that was running on the actual machines that they weren't actually real working devices at that period. But Biden was apparently none the wiser.
He set up his visit, the President and I share your vision of the new healthcare paradigm focused on preventative care. This is about when I first heard about Elizabeth and Theranos. Tonight, the story of two different places. I was working with Diane Sawyer on an investigation looking at the exploding costs of healthcare. An identical set of tests and one place charging the patient so much more. Why? ABCs Rebecca Jarvis, the world news investigation critical condition.
Theranos was pitched as an antidote, a solution to those rising medical bills. But we couldn't find an independent analyst to support Theranos' claims. Instead, most of the press at the time made note of Elizabeth's many eccentricities. In Fortune, for example, Elizabeth, quote, admits laughing nervously that after a meal she sometimes examines a drop of her own or others blood on a slide.
And says she can observe the difference between when someone has eaten something healthy, like broccoli, and when he splurged on a cheeseburger. When it came to explaining how the technology worked, the reporting was light on details. Like that Fortune cover story. The way we described it in the story is, 1-100th to 1-1-thousandth, the amount of blood that you would normally need to give blood, pain-free, quicker, cheaper, and you can do all sorts of tests on that single drop of blood.
The article quoted Channing Robertson, the Theranos board member and Elizabeth's former Stanford professor, who raved of Elizabeth, I could have just as well been looking into the eyes of a Steve Jobs or a Bill Gates. It said Theranos quote, currently offers more than 200 of the most commonly ordered blood diagnostic tests, all without the need for a syringe. An idea Elizabeth repeated on stage.
So our work is in making lab data accessible, and we've done that by making it possible to do any lab test from a tiny drop of blood from a finger, instead of having big needles stuck in your arm and tubes and tubes of blood taken out. But the article concluded quote, precisely how Theranos accomplishes all these amazing feats is a trade secret. Before Theranos employees who'd quit out of disillusionment couldn't believe what they were reading.
Like I fully expected the company to last maybe two years before running on a money and goodwill and running into the ground. So it was completely shocking. We met Adam Volmer in episode one, along with his work buddies Justin Maxwell and Mike Bauerley. They were watching from the sidelines as Elizabeth began popping up everywhere. And they were starting to wonder, did the company really turn things around?
When the whole Forbes high profile media blitz came around, and I remember among this group being sort of like in this moment of like were we wrong? But at the same time like knowing we weren't wrong, so we had this massive amount of skepticism. Two Theranos. Two Theranos. And I actively turned away at least a half a dozen people who were seeking jobs there. And felt like a crazy person for a good period of time there.
Even Avi Tivanian, Apple's former head of software and a former Theranos board member was wondering what on earth was happening. After all, he'd raised serious concerns and walked away from Theranos. Now I'm reading the press. Now I'm seeing things pop up inside of Walgreens and I'm wondering maybe it finally works. But I'm still in my mind remembering all these other things and saying I still don't believe it. I still don't believe it. Avi was right.
In reality, at the peak of Elizabeth's fame, Theranos machines could only run about a dozen tests and with only questionable accuracy. Just before Theranos launched its first wellness center at a Palo Alto Walgreens in September 2013, they couldn't even get the technology to work. Here's Adam Rosendorf, a lab director at Theranos. He's been questioned in a deposition about the Mini Lab. Another word for the Edison. Theranos' blood testing device.
When you say the Mini Lab was not working, what do you mean? It wasn't giving accurate results. But the fact the machines weren't functioning didn't seem to deter Elizabeth. You're about three months away from going live in the patient setting. Did it concern you that a number of tests weren't working on Theranos' devices? I know that we made mistakes, but we were trying to take this forward and at that time thought that we were doing the right thing.
Realizing their own devices weren't going to cut it, Elizabeth and Sonny had found a shocking work around. Theranos started buying and using blood testing machines from other companies. By the time they were about to enter Walgreens, it had already been going on for years. Listen to what Sonny says in this deposition. 2010. 2010 is the first time it'd be bought to see my machines.
Those Siemens machines were the same ones already in use at other lab testing companies, as in Theranos' competitors. But neither their biggest partner Walgreens, nor the public, had any idea. At that time we were told of the story and her vision for Theranos. And it was great. We thought something really special was going to happen. To capitalize on all the attention she was getting, Elizabeth called on one of the most exclusive advertising agencies in the country.
Shiet Day. They created those iconic 1984 and think different Apple campaigns. And you'll see why 1984 won't be like 1984. Elizabeth ever obsessed with Apple. Wanted them to make her an icon on the same scale. Mike Piedito and Stan Fiorito were on the Shiet Day team assembled to work with Theranos. I recently met up with them at a studio in downtown Los Angeles.
Here's Mike. My title was a management supervisor and what I was in charge of was helping to shepherd along communications for the Walgreens partnership. Dr. Reach out. And Stan? I was a group account director so I was the lead manager, led the team and was the key client contact with SunnybowlWonning. For the first meeting Shiet Day brought together a group of its most senior executives at their offices in Los Angeles. These offices, by the way, are exactly what you'd picture.
Ultra modern, totally distinctive, industrial. The outside is bright yellow. Inside there are trees growing through the floors and a coffee bar that feels like an art installation surrounded by surfboards. Elizabeth and her number two sonny flew in from the meeting from Silicon Valley on a private jet. Everyone from the highest levels was involved. I remember seeing her through the glass and being like, who is this person? What is this? This?
This is the stature of everything felt very, like a politician or royalty was there. We were only at the red carpet. The team was taken with the Theranos vision. And like pretty much everybody, they were also struck by Elizabeth, who made a dramatic first impression. I mean, the first thing if you ever meet Elizabeth that you've noticed is her voice. It's extraordinarily deep. It sounded like she was a man or a robot or both, a man robot. So you were kind of struck.
So, demeanorwise, she carried herself like a highly educated, highly intelligent person, which she is. And you're struck by her very measured way of talking and responding to you. And it did feel, as Mike said, almost like a very well-polished politician. And apparently, Elizabeth and Sonny were equally taken with Shia Day. Stanza's Theranos eventually inked a $6 million retainer with the agency, which later increased to a staggering $11 million agreement. Here's Ricohd's Cara Swisher on that.
That's a lot of money for marketing. I'm always wary when people do a lot of marketing. Same thing with office furniture. The offices are too nice. I always like, hmm, I wonder what's going on here. Was word got around about this secretive new client? Everyone wanted in. I think the vision of wanting to change the world. I mean, that was the vernacular that was used, was just like, change the world. That was really attractive to the type of person that worked at Work Dick Shia.
So a lot of people were raising their hands to work on it. We have so many people that I want to work on this. This is the type of work that I always wanted to do in my career. But it wasn't long before Stan says things started getting weird. For starters, Elizabeth would fall off the grid. She'd go dark for a month. And when you say she'd go dark, were you trying to reach her? And then she was just unreachable and no one would tell you what was going on? Yes. Is that typical?
Not given the ambition and the desire to move quickly. And then the completely unresponsive was odd. Very odd does. There were other strange behaviors Stan and Mike say they witnessed. Well there was one instance where we went up to Palo Alto and we were trying to get copy approved for the website. And she didn't want to have that conversation on it. She was really excited about showing us these little crocheted finger puppets, if you will.
And they were for potentially for children after they got their finger correct that they would give these away. And it was like talking to a 13 year old girl how excited she was. And she talked in a different tone of voice. It was interesting. Oh, she was using a different voice in this conversation. Yeah, the inflection was a little bit different. Yeah, it was a little bit more, like I said, it was childlike a little bit. Stan's job was also to manage Sonny.
And he says Sonny didn't make it easy. So you and Sonny got to know each other pretty well. As well as anybody could get to know Sonny, I guess. We couldn't find much information about his background. But we weren't sure besides a few things that we found on the internet. We weren't really sure what he was all about. So I think the odd behavior for me around him was his emphatic discussion around what the product does, why it does what it does, and why we shouldn't ask for any more information.
And what seemed odd to me was that he didn't have any training as a doctor. He didn't have any training running labs, yet when we tried to get to those answers, he became almost angry that we'd even asked the question. And that's what was really bizarre to us. How were they about paying their bills? Terrible. We couldn't get him to pay on time. Still, Mike and his team were busy working on the creative.
They wanted to be in over 2,000 Walgreens stores at a really short time frame, which put a lot of pressure on Mike was working on a lot of the retail work to get the retail work done. Just everything was based on this tiny drop of blood. So we wanted to make that a big portion of the iconography of the brand was. We wanted to have really strong human portraits where you're really looking into their eyes. The work they were producing was vivid and powerful.
In one sign, you see a child with big blue eyes, a quizzical look on his face. Across it, in bold type, it reads, goodbye, big, bad needle. Everything that we did, every piece of communication had to feel like you felt the importance of the mission. Even something like a little sign that was hanging down from one Walgreens in Palo Alto, it had that gravitas that felt like this is something big.
But before they could unveil the campaign to the public, Shiette had to make sure every claim Elizabeth and Sonny were making could actually be proven. And that wasn't easy. I mean, there were specific claims, like the four hour claim that was like, you can't say that unless it's four hours. Hundreds of tests on one drop was an interesting one because if you want to say hundreds of tests on one single drop, then it has to be hundreds of tests on one single drop.
No ambiguity, you have to be able to prove that that's how you do the test. You have to be able to do it then. Not in 10 years, not in 5 years, you have to be able to do it then. They amended the copy and forged ahead. But things got more bizarre. It's here! The stuck up in Save Sale is on this week at Lins, till you're pantry with deals by the dozen, including savings on your favorite food club items and more.
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Santiago Cabrera, Cebongolim Alambo, Ian Anthony Dale, and John Goodman. These people are evil and connoisse. Hindsight, the day before. Now playing on your favorite podcast app. With Theranos expanding in multiple cities, Mike asked an innocent question about plans to roll out more wellness centers in Arizona. I asked, where's the lab in? I think it's just because I was curious where it was and I was told, oh, we haven't built it yet, but you're doing the tests. How do you do the tests then?
And this is great. And then it was, oh, what we FedEx them up to, Palo Alto. Mike and I looked at each other and there was two problems with that. One was the speed and the other is, how are you using FedEx to actually carry somebody's blood? It was like, what wait? And especially when you consider what the promise of the box was, it was portable. You could run test really quick. I thought they were just going to be in every store and they were going to do it there.
That was, we were just, we couldn't believe it. It was, it was like, remember, when Theranos first pitched Walgreens, one of the key selling points was that their breakthrough device might cause it the box, could process tests right on site, but he inadvertently stumbled on a bombshell. Theranos wasn't going to actually put these devices inside of Walgreens. And why not? Because that would require FDA approval, something they didn't have. So Theranos took advantage of a loophole in the law.
They would put wellness centers inside of Walgreens, but they'd ship all the blood samples outside to Theranos' central lab for processing. This would let Theranos do the whole thing without FDA approval. Here's Sunny. We didn't need FDA clearances. I think at the end of 2011, early 2012, we said, what if it ships samples and shipped them to a central location? Yeah, it changes a few things in the model, but it allows us to launch faster. So I kept saying, well, where's the box? Where's the box?
And I think we would have conversations like, do you think this thing? Do you think this box is this? I don't think it exists. It wasn't long before many on the Shiet Day team were wondering exactly who or what they were really dealing with. I will say I was at one point convinced it was a front for the government. And the reason why is that one of the first meetings I had with her, she had said that the box had been field tested in Afghanistan.
And then you look at her board and you look who was sitting on the board and she would continue to drop major political and military names. And it got to the point where like, okay, maybe this whole thing is some sort of CIA drama. I mean, and I'm kind of joking, but I'm also not joking. I'm like, what's going on here? By now, the Theranos board was a who's who of government heavyweights. There was Henry Kissinger, perhaps the most famous secretary of state ever.
General James Madness, President Trump's now former Secretary of Defense. And George Schultz, former Treasury Secretary under Nixon and Secretary of State under Reagan. He was apparently dazzled by Elizabeth from their very first meeting. As soon as she started talking, I did a double take. Also on the board, former Tennessee Senator Bill Frist. I was impressed with the technology. An admiral Gary Ruffhead. I just saw this potential that was there and was intrigued by it.
And how exactly did Elizabeth get this collection of people to the table? Here she is explaining in a deposition with the SEC. Did you have a relationship with Henry Kissinger before he joined the board? No. Who introduced you to him? Drew Schultz. In fact, Secretary Schultz was the common link for most board members, including Senator Frist. He reached out and basically said there's an innovative company in the lab space that has impressive technology.
Admiral Ruffhead says he and Schultz, like so many others on the board, shared another connection. We are both fellows at the Hoover Institution at Stanford University. As many board members describe it, Secretary Schultz would kick things off, set up a meeting, and then Elizabeth would join and charm. Admiral Ruffhead says he saw big potential for deploying Theronose's devices with the Navy. Many of the ships that we operate operate without any medical officers on board.
And so for me, being able to see the technology deployed would ultimately result in better care and more immediate care for our people. It was an impressive roster of dignitaries, but some Theronose employees, like Michael Craig, were perplexed. A friend of mine said, your board looks like you guys are ready to take over the world not to start a medical device company. Stanford professor Phyllis Gardner was also dubious.
None of them, other than Senator Bill Frist, had any knowledge of medical devices, medicine, anything. I mean, they were just former secretaries of the Navy and secretaries of state. I mean, it was just a complete power circle that had no knowledge of what they were supposed to be governing. But investors loved it. They all invested on the fact that you had this wonderful board of directors about standing individuals by allowing their names to be out there. They all vouched for Elizabeth Holmes.
We met Reed Kathrein earlier. He's an attorney who sued Theronose on behalf of investors who put money into the company around the time their wellness center started popping up at Walgreens. Walgreens is going to go in. They must have looked at it. They must have tested it. And it must be good. It's litigated hundreds of these types of suits. And says this one feels remarkably similar to another one from earlier in his career.
That of Bernie Madoff, the former financier who's now serving life in prison for running one of the biggest Ponzi schemes in history. I spent six hours in jail interviewing him in South Carolina. Really felt that I got to see a little bit of who he truly was. And I see that in Elizabeth Holmes and the way she operated. And you think they're similar people? I think they're very similar people. Smart, charming, bullies.
Reed says just like Bernie, Elizabeth used her expanding circle of VIP connections to build trust and attract money. When all was sudden done, Elizabeth raised more than $1 billion for her company. The Walton family, founders of Walmart, invested $150 million. Medium-oval, Rupert Murdock put in 125 million. The Divas family, including now education secretary Betsy Divas, put in another 100 million. Husbands of one of the Devosis and one of the Walton family were on the same board together.
The other investors were all in one way or another tied with the GOP or the Republican party. And so she was able to sell to all these people and get them because they all trust each other if you're doing it. It must be good. And I'm sure you won't lie to me. And it wasn't just the ultra wealthy investing. I was told it was going to be the next big thing. And we all took a fly on it. And it turned out to be pack of lives.
Eileen LaPera, a retired executive assistant living about 15 minutes from the Theranos headquarters. Remember when she learned about an opportunity to invest in a promising new startup? You heard this company was going to be the next app. Yes. Eileen was retired by the time she heard about Theranos and saw it as a gamble with a potentially enormous payoff. She stretched and put $150,000 in the company. Had you ever put $150,000 into any other investment? Never.
It was the biggest investment of my life. And what did you expect? A new house with the proceeds. I'm chatting with Eileen in her living room. She now lives in her parents' former home. Well, you know, we didn't know much. We were told it was cutting edge technology. I basically believed the knowledge and the expertise of who I bought it from. Eileen didn't hear much about her investment early on. But she went to the Palo Alto Walgreens to have a look. And it was their first beta test site.
And it was just a simple door that said Theranos. I went in and I sat in a little room. There was a, I remember there was a fish thing and aquarium to, I guess, to calm you down. And it was a calming. And I thought this is cool. I thought it was modest, but I didn't think it mattered. And so my experience was good. And I felt, okay, we're on our way. At one point, Eileen took $50,000 out of the investment. Not because of any red flag, she says she just needed it elsewhere.
When she went in to fill out the paperwork, Eileen says she ran into Elizabeth. What did you think when you saw her? I was really shocked at how cowed the people were around her. The people around her changed when she came in the room. Yes. And what did they do differently? They seemed cowed, almost afraid. And do you have any kind of speaking interaction with her on that day? No. No, and I never saw her again. Eileen would also never see her money again.
But that wouldn't be clear for at least another two or three years. I'll never earn that much money back in my life. I don't have enough years to earn, and I'm retired. I don't want to go back to work. So it's a hard pill to swallow. If you could say something right now to Elizabeth Holmes, what would you say to her? Send me my $100,000 back, please. By 2015, Theranos was in about 40 Walgreens stores in California and Arizona. And people weren't just investing their money.
They weren't out putting their lives on the line as they turned to Theranos to test for hundreds of diseases, everything from cholesterol to cancer. People like 62-year-old Sherry Eckert, who were just learning about this hot new company, Theranos. My OB-GYN said, do you want to try one of the Theranos labs? And I said, hey, yeah, let's try it. You know, I've heard a lot about him. Sherry is a health care administrator. She's also a breast cancer survivor.
I had the bilateral mastectomy in the beginning of reconstruction December 18th. I had four months of chemotherapy. I managed well through the treatments because I was healthy otherwise. Finished the reconstruction, surgery, and go back to work. And I just kind of went back to life, kind of my new normal, I guess. She was now in remission, but was getting her blood drawn regularly to ensure the cancer hadn't come back. Sherry figured Theranos might be a nice alternative to her traditional tests.
Oh, my gosh. I've had my blood drawn over a hundred times. You know, once a cancer patient, always a cancer patient, so it really does change your life. So she went to a Phoenix wall, Greens. This is where I had the infamous blood draw. Went in, immediately gets seated. There were two people. They were awesome. They seemed to know what they were doing. But when the results came back, her heart sank. I saw that the estradiol amount was over 300.
The first thing that came to mind was, oh my god, it's recurring. I also called my oncologist's office and the nurse called me back and she said, I am so sorry, that's not good. If you've got an estrogen level of a 35 year old, there could be a tumor growing somewhere. I will never forget that day. The doctor told Sherry to go in for more tests, but this time recommended a nontherinose lab.
So it was about a week later, I got the call from my doctor and he said, congratulations, your estrogen is basically nonexistent. Thetherinose test had been off by hundreds of points. There was no tumor, no new cancer. Sherry says she tried to reach out totherinose for answers, but got no response. No one fromtherinose ever called me to apologize, no one.
And in my opinion, that's the least you can do when you mess up so badly with someone who's potentially got a cancer recurrence and they're worried, stressed out and you just ignore it, you just totally ignore it, not okay. Sherry was far from alone, around the same time, one stayed over, there was Palave Sharda. He's an anesthesiologist turned entrepreneur from a family of doctors. He visited the Palo Alto Walgreens. The first thing I noticed was the phlebotomist who was taking my blood.
I asked her, wait a minute, this is supposed to be a pinprick because they show you the mini-wiles, right? And I was like, well that's cool because I'm going to get that rather than a whole test tube draw. But she was doing a test tube draw in the usual way. She put a tunicate on and she took the test tube out and like, no, this is supposed to be like a tip. We're supposed to just take this out of my finger? Yeah, exactly, that's why I came.
There was a little red flag I was like, well, that's a false marketing. A few days later, Palave's doctor called with an upsetting diagnosis indicating that he was pre-diabetic. Your doctor says what? We can talk about some anti-diabetic medications that we can start. You want to start medication therapy? And I was like, no, no. Palave panicked. But before starting on drugs, he went to retake the same tests at a different lab. The new results put him safely outside the pre-diabetic range.
I am probably the safest error that Theranos made. I was taking care of myself, but I'm sure there were thousands of medical decisions made on Theranos lab results, which put serious medicines in people's pill packs for them to take without anybody double checking what that number was on the basis of which that decision was made. For medical professionals like Stanford Professor Phyllis Gardner, this disregard for patients' lives was unconscionable. I did not want her to get away with this.
I did not want a medical fraud perpetrated and glamorized by anybody. I'm a physician. Do no harm. I have no personal stake in bringing down the company other than I thought it was a medical fraud. And I do not assanction that in any way. While Palave and Sheri were getting their test results, back in Los Angeles, Mike Padito and Stanford Euredo, the guys from the Apple ad agency, had long since moved on from Theranos.
They say out of nowhere, Elizabeth and Sonny suddenly ended their relationship with the company. The Shia Day team was frankly relieved, but Mike says he still couldn't shake the feeling that there was something seriously wrong going on at Theranos. So I thought, at some point, something will happen that's going to expose this. But you just didn't know how deep it was and who that person was going to be.
But I literally would Google Theranos scam, wondering when that information was going to come out. And he says the lingering apprehension that Elizabeth and Theranos might retaliate against Naysayers, given how secretive and protective they were of their brand at any cost, had never really gone away. And I got to be honest, even talking to you guys now, there's still a part of me that has fear in, I'm like, is this, are we being set up?
Are there going to be cops that come in and arrested so lawyers that come through? Just because they were just very unscrupulous when it came to just defending and protecting and making sure nobody talked. On the next episode of The Dropout, many employees are at a breaking point, horrified by what they believe to be widespread deception and dangerous practices.
It really started to eat me up inside and really violated the very basic and simple principle that I had guiding me as a scientist as just a human being. They're desperate to break their silence, but Theranos is employing increasingly extreme measures to stop them. The threat of litigation was always in the air when you worked at Theranos. Employees knew it was not an empty threat. People were terrified of retribution. But one brave and unlikely whistleblower is about to emerge.
My grandfather would say like, things like your career will be ruined if this article comes out. Earl Morris, Elizabeth Holmes and Sunny Bawani did not respond or declined to comment for this podcast. Some material, including court depositions, were edited for clarity and time. The Dropout is written and produced by Taylor Dunn, Victoria Thompson, and Meam. Our editors are Chris Baroube and Evan Viola, who also created our theme song, additional editing on this episode by Nick McCity.
Our researchers are Victor Ordoniaz and Lane Wynn. Our artwork is by Teddy Blanks at Chips & Y. The Dropout is a production of Nightline ABC Radio and ABC's Business Unit. For Nightline, Jenna Millman is the supervising producer and Steven Baker is the executive producer. Eric Goverham runs ABC's Specialized Units. Thanks to the team at ABC Radio and to the Wall Street Journal's John Kerry Rue, author of Bad Blood, whose investigative reporting first exposed this remarkable story.
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